Playing local shows and bar gigs can eventually lead to your big break as a musical group. Working towards your dream, with some of your best friends can be an incredible journey. However, before seizing the opportunity to sign with a record label – or headline any shows – be sure to have a Band Agreement, or as it is known in the legal world, a Joint-Venture Agreement.
A Joint-Venture Agreement is established between partners (in this case, members of a band or musical group). It is a common agreement between partners in most businesses, so why not yours? Outlined in the agreement are the duties and obligations of each member towards one another and the specified venture itself. It will set out goals, roles and decision making processes that may help avoid some fights on the tour bus. There are a few types of Joint-Venture Agreement. However, in the event of a band being formed, seeking out a contractual joint venture is the most beneficial.
What is a Joint-Venture Agreement?
This agreement is created between two or more parties. Within the contract, all parties are contractually bound to combine resources and expertise with a shared view to carry out a specific project or venture. This agreement can be formed between group/band members who are becoming successful and want to protect themselves and each other when moving forward as a group.
Ultimately, a Joint-Venture Agreement is a broad contract that is not legally bound to one set legislation. Instead, it is enforced under the jurisdiction that the parties choose. This means that the contract will only be held to certain provincial, and some federal, laws that pertain to written contracts and business arrangements.
What benefits come from a joint-venture agreement?
When creating the agreement, and because of the lack of direct legislation around it, there is a lot of freedom surrounding which clauses and stipulations to include. This freedom allows for creativity when drafting to ensure that everyone understands what they’re signing and that the specific nuances to your relationship are noted.
Likely, because you are pooling your talents together and aiming to move forward as a group, one person is not responsible to handle any losses that the group may encounter. Unknown expenses, gear upgrades, marketing and distribution are all covered by the group’s income, not just a lone member’s finances. Unless of course, you agree to go about it that way. Fortunately, this also means that the income garnered by the success of the group is spread among the members in accordance with how they all decided to split it in the Joint Venture Agreement.
The Entertainment Law team at Hummingbird Law can sit down with you, and/or your group, to provide legal advice on your agreement, or guide you through the process of creating it. Contact Hummingbird today to talk to the team and make sure that your Joint-Venture Agreement represents your plans as you move forward with your success.